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HomeMy WebLinkAbout12-16-2014 SS1 RowleyChristian, Kevin From: Sent: To: Subject: Attachments: SS1 12/16/14 Anthony J. Mejia, MMC San Luis Obispo City Clerk Anthony Mejia City Clerk COUNCIL MEETING: 1 Z l 1. ZOO 1-I ITEM NO.: ! Mejia, Anthony Saturday, December 13, 2014 11:10 AM Christian, Kevin FW: SS1 Review of Rental Housing Inspection Program Options Rental Insp Ltr 12- 16- 2014.doc ~ 4 Sffn LUIS OBISPO City Administration City Clerk's Office 990 Palm Street, San Luis Obispo, CA 93401 -3249 E amejia @slocity.org T 805.781.7102 slocity.org From: Sandra Rowley Sent: 12/13/2014 9:48 AM To: Marx, Jan; Ashbaugh, John; Carpenter, Dan; Christianson, Carlyn; drevoire @slocity.org Cc: Meiia, Anthonv Subject: SS1 Review of Rental Housing Inspection Program Options Attached please find RQN's input on this topic. 1 DEC 15 2014 COUNCILMEETING: �?-f 16I7'Z`L� Residents for Quality Neighborhoods P.O. Box 12604 • San Luis Obispo, CA 93406 December 12, 2014 DEC 15 2014 RE: SS1, Review of Rental Housing Inspection Program Options Dear Mayor Marx and Members of the Council, Residents for Quality Neighborhoods (RQN) supports a Residential Rental Inspection Program for single - family and duplex dwellings as part of Neighborhood Wellness for the reasons given in our position paper (attached). We support Option 1 as well as staff's recommendations for Best Practices and the recommendations contained in the Next Steps matrix. Earlier this year City Council members were given a tour of the four houses at Grand Avenue and Slack Street that were purchased by Cal Poly. Subsequently, these houses were toured by several members of RQN along with members of the Alta Vista and Monterey Heights Neighborhood Associations. Their condition was appalling. In addition to the obvious lack of maintenance, unpermitted construction and absence of basic housekeeping, there was a decidedly unpleasant odor present. These houses had not been vacant; they had consistently housed Cal Poly students year after year from the beginning to the end of the school year. The condition of these rental houses was not apparent from the sidewalk. Only by going to the rear of the property or into the interior were the various problems apparent. Are these the only examples of rental housing in which unsafe, unsanitary conditions are present? One would hope so, but logic says otherwise. According to information provided to the Chamber of Commerce this summer, about 50% of rental properties are self- managed by the property owner. Many of these property owners live outside the city or outside the county, some of whom do not regularly see their properties and are unaware of any deterioration. Unfortunately, the number of properties in this category is unknown because not all rental property owners have a business tax certificate and business license and because property owners who do have the certificate and license are not required to list the location(s) of their rental(s). Since the recommended program is to be self- supporting, RQN was pleased to see that the estimated cost for inspections on a 3 -year cycle was under $100 per year. Also, the plan to provide prior notification of the date of the inspection should make it easier for tenants and property owners and /or property managers. We recommend a few additional items be considered during your deliberations: 1) the addition of slightly reduced fees to the list of Incentives; 2) the addition of an inspection upon sale; 3) the addition of a requirement to list the address of each residential rental property covered by the business license or alter the licensing requirement so that a separate license is required for each Page 2 rental property in order to create a more complete inventory of residential rental properties; and 4) that staff conduct compliance verification for residential rental businesses more frequently than every five years. Thank you for your attention to this important matter. With so many cities having rental inspection programs and breaking this ground for us, we trust that, working together, we can develop a program that meets the needs of all residents, one of which we can be proud. Respectfully submitted, Sandra Rowley Chairperson, RQN Attachment COUNCIL MEETING: (l. L0kL4 ITEM NO.: �g,S I all Residents for Quality Neighborhoods RO. Box 12604 • San Luis Obispo, CA 93406 Position Paper: Rental Property Inspection DEC 1 5, 2014 The Residents for Quality Neighborhoods (RQN) Board is unanimously in favor of the establishment of a Rental Inspection Program. Lest it appear that this is a program we want solely to impose on others, fully one -half of RQN Board members own rental property. a. Our primary concern is the health, welfare and safety of tenants and nearby homeowners. b. Our secondary concern is the maintenance of the city's housing stock for future residents. c. Our long -term concern is the prevention of houses that are uninhabitable, vacant and, thus, an attractive location for unlawful behavior. The current system of identifying health, welfare and safety problems in rental properties rests on receiving complaints from tenants or others knowledgeable about the situation. Regrettably, some renters may not have the requisite knowledge to be able to identify potentially harmful situations. Recent focus by Cal Poly on student success and the various factors that contribute to that success has revealed the reluctance of student renters to address problems with their landlords because of concerns about being evicted, losing their deposits and /or having their rents increase. Subsequent conversations with older renters revealed some of the same concerns, especially the concern about future rent increases. Thus, those most knowledgeable about problems that exist in a rental house are the most reluctant to complain. Owning residential rental property is a recognized business as evidenced by the City's Business License and Business Tax requirements for rental properties. Per the City's website, a "business license" is issued as a regulatory permit and a "business tax certificate" is issued to raise revenue for general municipal services. Both are required of owners of residential rental property (see attachment). It is not uncommon for businesses to be inspected; this business should not be exempt. It has become apparent that current regulatory measures are insufficient to insure the continued maintenance of residential rental properties. The obviously unkempt appearance of the exterior of many rental properties is an indication that the interior may be similarly neglected, thus endangering the health, welfare and safety of both occupants and nearby residents. Currently there is no mechanism to insure that houses for rent are safe for occupancy. There are additional, related, problems to overseeing the City's rental housing. a. Much of the rental housing is owned by absentee owners who cannot or do not regularly visit the property and may never see or learn about problems that exist or overall deterioration that may have occurred since they purchased the property. b. It is unclear whether realtors who sell residential property that is to be rented disclose the City's business license and business tax requirements and provide applicable forms. Page 2 c. However, the most significant problem is that City staff does not possess a complete list of rental houses, where each is located (the address) and the name of the owner. The Business License applies to all businesses owned by the license holder, including the aggregate of rental properties; residential rental property owners are not required to list all rental properties covered by the license. This needs to be corrected, and can be as part of the rental inspection program. We are not the first city in California to initiate residential rental inspections. Several cities, large and small, have such ordinances. Sacramento has one as does Santa Ana. Cities with populations similar to that of San Luis Obispo that have such ordinances are Azusa (pop. 46,000) where approximately 50% of the housing are rentals, Oakley (pop. 35,000) and Santa Cruz (pop. 62,000). Although acknowledging the need for a residential rental inspection program, some of our membership worry that the City is creating another bureaucracy and that funds collected for this program will be diverted from the General Fund to support other purposes. Requiring that the program be not only self - supporting but that fees collected for the program be separately accounted for may allay some of those fears. In addition to supporting a Residential Rental Inspection Program, we encourage you to insure that the following be included: a. Incentives for properties that have no violations or violations that can be, and are, easily corrected. b. Disincentives for properties that have multiple violations, violations that are not easily correctable and violations that, after being identified and discussed, are not corrected. c. Reinspection fees that rise if multiple reinspections are required. d. Contract inspectors and /or privately hired, certified inspectors be available as an option to rental property owners. e. Inspection of the interior and exterior, with emphasis on the interior. f. Exemptions for mobile homes and publicly -owned housing, but not for owner - occupied homes with rooms for rent. Home owners renting rooms have the same obligation to insure the health, welfare and safety of their tenants and of nearby homeowners. g. The program be limited to R -1 and R -2 neighborhoods. Unlike R -3 and R -4, dwellings in these zones are not subject to other inspection programs. h. A phased program beginning in areas that City staff have identified as having sub - standard rental housing. Respectfully submitted, Sandra Rowley Chairperson, RQN Attachment Page 3 The following is an excerpt from the City's website. What is a Business Tax Certificate? The purpose of the City's Business Tax ordinance is solely to raise revenue for general municipal services to residents and businesses, such as police and fire protection and street maintenance. It is not a "license" or "permit." The Business Tax Certificate is issued by the City of San Luis Obispo to all persons conducting business in the City. "Business" means and includes enterprises, leases, establishments, professions, rentals, services, trades, vocations, and occupations of all types whether or not the business has a fixed location in the City. (Emphasis added) What is a Business License? The purpose of the City's business license regulations is to provide for necessary regulation of lawful businesses being conducted within the City in the interest of the public health, safety and welfare of the people of the City. While due diligence will be exercised in reasonably ensuring compliance with all City policies, regulations and ordinances before issuing a business license, the Primary focus of the City's business license regulations is to provide reasonable assurance that businesses operating in the -City are doing so in compliance with the City's planning and buildin policies, regulations, and ordinances; and in compliance with the City's business tax provisions. (Emphasis added) What is the difference between a license and a tax? A "business license" is issued as a regulatory permit. A "business tax certificate" is issued to raise revenue for general municipal services.